[PPT] - 1 Outline Agenda Connections Market Overview Progress with PowerPoint Presentation

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Connections Update

UR Connections Policy Call for Evidence Workshop Joint presentation by NIE Networks and SONI 12 December 2016

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Outline Agenda

Connections Market Overview
Progress with Contestability at Distribution
Status of Generation Connections – SONI and NIE Networks
Stakeholder engagement / consultation over the past year
Challenges going forwards

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860,000 customers in NI
47,000km of network
Circa 8,000-10,000 demand connection applications each year
Typically 75 / 25 split domestic/commercial
Vast majority of demand connections < 5MW
Over 1008MW of renewable generation connected to date
Vast majority of Generation applications for Small Scale

Generation < 5MW

Limited remaining grid capacity and unprecedented levels of

generation applications in NI has resulted in an alternative application and offer process for generation connections http://www.nienetworks.co.uk/documents/Generation/Alterna tive-Connection-Application-and-Offer-P-(1).aspx

The NI Distribution Network

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Distribution Charging Principles

For all connections - applicant pays

– Unique connection assets – Network reinforcement at voltage of connection and level above

Rebate applies to domestic customer only
Cluster principle

– To forward fund investment through regulatory mechanism

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Contestability in Distribution Connections >=5MW

Contestability is available for connections of 5MW and

greater to the distribution network- this covers both generation and demand

You now have the choice to ask an Independent

Connections Provider (ICP) to undertake the ‘contestable’ work required for your connection or to ask NIE Networks to undertake all connection works.

14 ICPs are accredited through Lloyds Register to work

in Northern Ireland

Whichever option you choose, we will send you a

quotation for the work we will undertake.

This is called a ‘Connection Offer’ and will explain our

costs and the different choices you have.

https://www.uregni.gov.uk/publications/decision-paper-contestability-electricity-connections http://www.nienetworks.co.uk/documents/Connections/Contestability-Guidelines-Version-2-2016-05-30.aspx

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ICP Portal

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Shaping the future of Connections

Market open for all new distribution

connections >=5MW from June 16

Business transformation underway to

facilitate a competitive market for all new connections in NI in 2018

Learning from GB DNOs and ICPs on

best practice

Delivering great customer service for

contestable and non-contestable works is a key priority for us

Contestable offers being issued – and

accepted

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Generation Connections Status

550 1008 1000 1250 718

Constraints Vs Investment

500 1000 1500 2000 2500 3000 3500 MW

Min Load Max Load (c.1800 total)

Renewable Gen. System Load Transmission Capacity

Constraints Vs Investment

Connected Committed Achieving 25% (900 MW) Enabling 27% c.1000 MW under Medium Term Plan c.1726 MW Committed Max System Load c.1800 MW

*Predictions accurate based on current information at the beginning of December 2016

Phase 2

Phase 1 c.200 MW

c.1700MW Applications

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451 517 629 659 747 1164 1343 25 41 76 129 183 293 293

45 65 78 90 90

200 400 600 800 1000 1200 1400 1600 1800 2000 2012 2013 2014 2015 2016 YTD March '18 Beyond March '18 LSG(MW) SSG(MW) Micro(MW)

Potential Total Generation (Connected and committed) c.1726 MW

*Predictions accurate based on current information at the beginning of December 2016

c.1547 MW 1008 MW 853 MW 750 MW 562 MW 477 MW

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Alternative Connection Application and Offer Process Consultation Process to Date

Utility Regulator (UR) Determination DET-572 in July 2015.
NIE Networks removed planning permission requirement – Aug 2015.
Unprecedented level of generation connection applications received
NIE Networks and SONI engaged with industry to develop an

“Alternative Connection Application and Offer Process”

Industry engagement workshop December 2015
Consultation Paper and industry workshop in March 2016.
Decision Paper issued on 31 May 2016.

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Progress to Date with Phase 1

Phase 1 – will potentially release c200MW of network capacity
Overall – Offers issued for c130MW Export; 13MW Zero Export
Current Position - LSG

– 10 Offers issued c120MW – 4 Contestable Offers issued

Current Positon – SSG

– 57 Offers issued c11MW

Zero Export – total of 25MW to be issued

– 25 Offers issued c13MW

Over-install

– Expect to commence issuing Offers very shortly

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Decision on Phase 2

Concluded that “Batch Process” should not be implemented without

further engagement with industry stakeholders and policy makers

Key to this conclusion was:

– uncertainty around renewable energy policy and targets – uncertainty around UR approval of network investment

An enduring offer process should allow NIE Networks and SONI to

plan and develop the Distribution and Transmission Systems with more certainty around network investment and energy policy.

Enabling connection offers to be issued with more certainty around

how the network will be developed to accommodate the connection

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Next Steps for NIE Networks and SONI

NIE Networks and SONI have had initial engagement with the UR

and Department for the Economy in relation to the uncertainty around network investment and energy policy.

UR has issued their Call for Evidence as part of their review of

Connections Policy.

We will work with UR to put in motion the commitments we have

made to industry in the Decision Paper on the Alternative Connection Application and Offer Process through: – Responding to the UR consultation papers. – Participating in the UR’s working group.

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The Reverse Powerflow Issue

AD Minimum Load WIND

PV

AD

PV

Minimum Load

WIND

PV

Zero Export

r

MEC Utilisation application Reduces min load Additional capacity by adding the min load assumption Reverse Powerflow Limit

Network Capacity (Tx or 33kV)

Additional capacity by investment in reverse Powerflow plant

Network Capacity (Tx or 33kV)

Network Overload No Reverse Power

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Concluding Points

Contestability now active for Distribution

– LSG Contestable Offers issued and being accepted – Working toward full market opening

Design of Alternative Method for scarce capacity

– Good progress with Phase 1 release of Offers

Shift from demand to combination of generation and demand

– Impact on network

Strategic decisions required on energy policy and network

investment

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